Geopolitical risk vs NZD retail sales
|NZDJPY, H4
North Korean successfully launched a mid-range missile, taunting that it would be able to carry a nuclear warhead, but market impact was limited after an initial jolt to stock markets in Asia. However, the Japanese currency underperforming today. The USDJPY has retreated to around 113.50 after logging an intraday peak at 113.73 following a 60-pip-plus rally from the lows seen at the open in the Asia-Pacific market. EURJPY rallied quite strongly earlier, capping out at 124.48, six pips shy of last week’s one-year peak. The yen correlated as European stocks rose in early trade, though this move has since flagged, taking the steam out of the bullish moves in USDJPY and yen crosses.
NZDJPY lifted to a 4-session high of 78.47, in 4-hour chart, prompting a Long position with entry at 78.35. Geopolitical risk and the good Retail Sales data from New Zealand, gave today a boost to NZDJPY, which lifted from past week’s low of 77.53. In the Daily chart, pair broke earlier the 50 Day and 200 Day EMA, while MACD turned positive. In the 4-hour chart, RSI is at 58 sloping up, while Parabolic SAR turned positive earlier. Therefore, with the pair looking ready to close the 11th of May gap, target 1 was set at 78.62 and Target 2 at 78.88, using ATR(14) in the 4-hour chart. Support was set at 20-Day EMA, i.e. at 77.35.
Nevertheless, pair is likely to be volatile this week by Q1 PPI from New Zealand to be released on Tuesday. Meanwhile, there is nothing from the Reserve Bank of New Zealand this week. Last week saw the Bank hold rates steady at 1.75%, as expected, but leave a dovish tone in place amid the “numerous uncertainties” that remain. A somewhat more balanced outlook was anticipated from the Bank.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.